Mature-node foundry prices set to rise as AI demand tightens capacity
A structural shift in the global mature-node foundry market is underway, according to research from TrendForce. Capacity cuts, surging demand for AI power components, and TSMC's planned reallocation are combining to push utilisation rates toward 90% — and set the stage for price increases.
The average 8-inch capacity utilisation rate among the world's ten largest foundries is projected to approach 90% in 2026, up from around 80% in 2025, according to a press release from TrendForce.
Leading foundries, including TSMC and Samsung Foundry, have been reducing 8-inch capacity since the second half of 2025, but sustained demand growth for power management ICs and power discrete components – driven by AI servers, general-purpose servers and edge AI applications – has more than absorbed the reduction. Foundries have already begun passing price increases through to customers.
TrendForce expects global 8-inch capacity to remain in negative growth through the first half of 2027. Products such as PMICs and power discretes, which remain largely dependent on 8-inch processes, will keep utilisation rates above 80% over that period.
Capacity reallocation reshaping the 12-inch mature-node market
On the 12-inch mature-node side, the dynamics are more complex. Nearly 70% of capacity expansion in this segment is being driven by Chinese foundries, while expansion elsewhere remains moderate. Taiwanese foundries are simultaneously reallocating capacity away from display driver ICs and CMOS image sensors toward higher-margin PMIC, BCD and power discrete production – a shift that is pushing customers in those displaced segments toward Chinese suppliers.
The migration has been visible since the second half of 2025. Chinese foundry Nexchip, which focuses on mid- to low-end display drivers and image sensors, has already seen supply tighten as a result of the increased inbound demand.
TSMC's planned cuts add further pressure
TSMC's proposed reduction of mature-node capacity is the variable TrendForce identifies as most likely to trigger broader price movement. The reduction is expected to proceed gradually over the next one to three years, constrained by the fact that advanced-node customers still depend on mature-node capacity for peripheral components, and existing customers need time to qualify alternative foundry partners.
In the interim, customers are already seeking support elsewhere. UMC has reported increased incremental orders as a result. While 12-inch mature nodes are not yet in severe shortage, TrendForce does not rule out that order spillover from TSMC could prompt tier 2 foundries to signal price increases in the second half of 2026.
The full impact of the redistribution is expected to become more pronounced after the second half of 2027, when new product tape-outs from the current qualification cycle reach mass production.
.png)